Research - Low Cost Service Delivery Models

Technical services are increasingly becoming a commodity. Although in many industries companies have managed to develop their services portfolio from the traditional product warranty and support services towards more advanced services. Such services include product related availability services and knowledge driven services. However, with competition on services heating up, more players are entering the market. In some industries such as IT and Medical Equipment ,it is already common practice for third-party service providers to provide multi-vendor services. For original equipment manufacturers it is more difficult to achieve satisfactory profit margins on their basic service offering.

Traditionally the OEM’s have a higher cost structure than the mean-and-lean third party service providers. OEM’s they depend on a steady cash flow from basic services to develop and sell more advanced services for which less competition exist.

Remote monitoring technologies allow OEM’s to gather data and even manage equipment or software remotely. This technology not only helps to lower the cost of service delivery for OEM’s but  can also be the driver for the development of new more advanced services. Entirely new service delivery models are created which are low cost and at the same time high value added for customers. Therefore low cost delivery models are a double-edged sword; they help to lower cost and are more price competitive. They also create new market opportunities for companies when they re-engineer their entire service delivery model, to combine low cost with new high value services that are using the information and processes that have remote service capabilities built-in.

Noventum Service Management Consultants will publish a new research report in April, 2012, exploring what are the best practices and trends in building Low Cost Service Delivery models. The research will consist of interviews with service executives as well as a global survey. It will also include insights on what are the most effective low cost service delivery models and how companies have successfully made the transformation to low cost service delivery models.

Service executives wanting to participate in our research can register their interest to attend. Participants will receive full preliminary findings and the full survey report results and will help define best practice for low cost service delivery models.